24 Apr 2009

Oil rises as dollar falls, stock market gains

10:57 am on 24 April 2009

The price of oil rose on Thursday as a fall in the dollar and stock market gains outweighed rising US inventories.

US crude settled 77 US cents higher at $US49.62 a barrel, after earlier trading down to $US48.37. London Brent crude traded up 30 US cents to settle at $US50.11 a barrel.

The euro gained against the dollar as demand rose on better-than-expected earnings results from banks and as data on euro zone industrial new orders showed a smaller-than-expected decrease.

A falling dollar can boost the appeal of oil and commodities to investors as an inflation hedge.

Oil's gains came despite swelling US crude inventories, which hit a fresh 19-year high last week, according to US

government data released on Wednesday.

The slumping economy has clipped fuel demand and dragged oil prices off record highs over $US147 a barrel hit in July.